Everyone’s asking San Francisco: Can you see a bubble if you’re in a bubble?

The spreading grip of the technology sector on the San Francisco Bay Area means the boom reaches to every service sector that well-paid techies consume. But what that really means is that when a tech boom becomes a bubble, it’s a real-estate bubble, a restaurant bubble, a luxury-vehicle bubble, even a public-services bubble, writes Charles Hugh Smith.

Boom money can land its beneficiaries and all the hangers-on in the center of said bubble, a vantage point from which it’s nearly impossible to realize you’re in a bubble, Smith writes in his Of Two Minds blog.

“You will find it difficult to walk more than a few blocks in central San Francisco without encountering a major construction project. It seems that every decrepit low-rise building in the city has been razed and is being replaced with a gleaming new residential tower,” he wrote.

San Francisco can’t even contain its boom; rental prices in once blue-collar, then Bohemian, Oakland are north of $3,000 a month for a large one-bedroom with a Bay view. Yet that relative discount to San Francisco leaves Oakland in a bubble of its own. Techies working for free on a buddy’s start-up have famously rented the space beside the washing machine in a laundry room for $400 a month.

It’s not just the Bay area, either. The bubbles in Seattle and Portland that so many view as permanent features of their rising wealth will also succumb to gravity, Smith worries.

In fact, the biggest bubble of all may just be a power bubble — perceived, real, doesn’t matter.

For Smith, it’s a “hipster-techie mental map,” sketched for those who may still suffer from delusions that Washington D.C. and New York matter (Hint: they don’t, says Smith.).

The center of the world

As for history repeating, with new lessons learned, he writes: “I distinctly recall the mass excitement of COMDEX in 1999, the big computer-tech trade show in Las Vegas. The city was packed, the convention centers were packed, and an enormous banner announcing the then revolutionary slogan “the network is the computer—Sun Microsystems” welcomed the faithful. A year later the bubble had burst, and a decade later Sun Micro had lost its edge and would end its glorious run in the ignominy of being sold to Oracle for pennies on the dollar.

I saw Bluetooth demonstrated for the first time in that show (at a Motorola booth), and dozens of other consumer technologies that never quite caught on—kits to turn your PC into a TV, etc. Now we see the same euphoria in the FAANG stocks, Big Data, A.I., crypto-currency and so on.”